Equity Bank founder's wife blocks auction of Sh640m Britam shares

A court battle between billionaire banker Peter Kahara Munga, the celebrated founder of Equity Bank, and his wife Rose Njambi Munga has peeled back the mask on a bitter Sh640 million dispute over Britam shares allegedly used to repay a debt.

Njambi recently persuaded the High Court Commercial Division to freeze a secret plan to sell off 75 million Britam shares tied to a multimillion-shilling bank loan, claiming the shares were matrimonial property acquired during the couple's decades-long marriage and that she had not consented to their use as collateral for her husband's loans.

Court documents show that the shares, held by Dr Munga's companies, were originally pledged to ABC Bank and its investment arm, ABC Capital, to secure a loan of nearly a billion shillings, intended to fund the supply of food after he won a government education tender.

Njambi argued that the move violated her constitutional rights under Kenya's Matrimonial Property Act, which requires spousal consent for the sale or pledge of jointly acquired assets.

According to court records, between 2022 and 2024, Munga-controlled Equatorial Nut Processors borrowed Sh882 million ($6.83 million) from African Banking Corporation's (ABC Bank) to supply goods to the World Food Programme, KEMSA-Global Fund, and the Ministry of Education.

Last year, however, Dr Munga defaulted on the repayment of the loan worth over Sh400 million.

To recover the debt, ABC Bank moved to seize the Britam shares, valued at Sh640 million, after courts earlier found Munga had lawfully pledged them as collateral.

In January and April this year, Justice Alfred Mabeya gave ABC Bank the green light to auction the 75 million shares Munga held at Britam Kenya over the debt guaranteed by his companies.

After learning that ABC's planned to auction off the shares, which were pledged as collateral for loans advanced to Munga, Njambi entered the dispute seeking a court injunction and recognition of her ownership under Kenya's Matrimonial Property Act of 2013, claiming the shares were jointly owned.

She accused her husband and ABC Bank of attempting to sell the assets without her knowledge or consent.

"The loss of the shares prior to the hearing would cause irreversible prejudice," ruled Justice Peter Mulwa, temporarily blocking the sale that ABC Bank and ABC Capital had initiated to recover millions in unpaid loans tied to Munga's companies.

The judge found that Njambi had proven an arguable case that her husband unlawfully pledged matrimonial property to secure loans without her consent.

The freeze order, highlighting a spouse's veto power over loans secured with joint assets, will remain in force pending determination of whether the shares are indeed matrimonial property.

For decades, Munga's name has symbolized triumph, the man who turned a rural building society into Equity Bank Group, Africa's most inclusive banking giant. Yet behind the prestige and philanthropic glow, his personal life has quietly cracked open before Nairobi's High Court.

Court papers reveal that Njambi, who describes herself as Munga's lawful wife, filed a petition on August 1, 2025, seeking urgent protection over what she calls jointly acquired matrimonial property.

At the centre of her case are 75 million Britam Holdings shares, split between 25 million registered in her name and 50 million in Munga's name, all now frozen by the court.

Unbeknown to her, Njambi claims her husband secretly pledged the entire block of shares to ABC Bank and its investment arm, ABC Capital, as collateral for multi-million shilling loans without her consent.

Those loans, she says, were tied to Munga's ventures, including Equatorial Nut Processors Ltd, that later fell into default, triggering a planned sale to recover over Sh274 million and USD 1.23 million.

"I was neither consulted nor did I consent to any charge or pledge involving the said shares," Njambi told the judge. "The move to sell them amounts to a violation of my constitutional right to property and equality within marriage."

Her lawyers, led by Tali Tali, argued that under Article 45(3) of the Constitution and the Matrimonial Property Act, spouses have equal rights to property acquired during marriage, regardless of registration.

"The law is clear; one spouse cannot secretly dispose of matrimonial property without the other's consent," her lawyer told the court. "Mrs Munga is simply asking for fairness and transparency."

Njambi herself described the situation as "devastating," saying the shares represented decades of shared effort.

Her affidavit emphasised that she was not party to previous cases Munga filed against the bank and that those proceedings did not consider her marital rights.

"Without this injunction, I will lose our family's only substantial asset," Njambi argued in court filings. She offered Sh100 million as security, a condition the court accepted.

At the heart of the dispute is one of the country's most valuable stock holdings - Britam Holdings Plc, a blue-chip insurance and investment giant in which Munga has long been a major shareholder.

The contested shares, now frozen by the court, are estimated to be worth around Sh640 million (approximately $5 million), based on market valuations at the time of filing.

In its response, ABC Bank opposed the application, terming it a sham and a tactical distraction, claiming the case was part of a pattern of vexatious litigation aimed at frustrating legitimate recovery.

Faith Nteere, the bank's Senior Legal Manager maintained that the shares were rightfully pledged as security for multiple credit facilities advanced to Munga and companies linked to him, including Equatorial Nut Processors Limited.

According to the bank, the loans secured by the shares amounted to Sh274 million and USD 1.23 million, with additional guarantees executed by Munga personally and blank share transfer forms giving the bank full rights to sell in case of default.

"The borrower defaulted in repayment despite multiple notices. The bank cannot be held hostage by family disputes over securities lawfully pledged for credit facilities," Nteere said.

The bank also accused Njambi of being "a proxy" of her husband, strategically introduced into the litigation to buy time.

It further argued that no marriage certificate was provided to prove the marriage, and that the 50 million shares were solely registered in Munga's name; hence, no evidence of joint ownership or spousal consent existed, save for the 25 million directly under Njambi.

"There is no evidence of joint ownership or any indication that the bank was aware of her alleged beneficial interest," the lender maintained.

Faced with competing narratives, a wife's plea for protection and a bank's demand for repayment, Justice Mulwa struck a delicate balance.

The judge said Njambi had demonstrated a prima facie case, meaning she had an arguable right that appeared infringed and needed temporary protection.

"On the totality of the material before me, the applicant has shown an arguable claim deserving preservation," he ruled.

"Whether a valid marriage existed and whether the remaining 50 million shares constitute matrimonial property are issues for full trial."

The judge agreed that selling the shares before hearing the case could cause irreparable harm to Njambi who claims the assets constitute the only substantial property acquired during her marriage.

He issued the orders noting that since shares in a publicly listed company like Britam fluctuate in value and, once sold to third parties, cannot easily be reclaimed.

"The loss of the shares prior to the hearing would cause irreversible prejudice. Monetary compensation alone would not sufficiently protect her rights to property jointly acquired during marriage as enriched under the Constitution and the Matrimonial Property Act," Justice Mulwa observed.

The court directed Njambi to deposit Sh100 million in a joint account with the bank's lawyers as security, a gesture seen as balancing fairness to both sides while preserving the disputed shares.

The order effectively froze the shares and preserved their ownership pending determination of the main suit.

The dispute started in September last year when the bank declared the businessman in default of Sh274 million and $1.23 million (Sh159 million), loans totalling Sh433 million, in unpaid debt.

ABC Bank took part of the shares as collateral without Ms Njambi's approval and when Munga defaulted repayment, it issued a demand notice dated September 24, 2024 seeking payment of Sh433 million, failing which the pledged shares would be sold.

This sparked a legal dispute between Munga and the Bank.

The bank's lawyers disclosed that multiple suits had already been filed by or on behalf of Munga in Milimani, Machakos, and Kiambu courts, all seeking to stop the same share sale.

Multiple suits filed by or on behalf of Munga to stop the sale were largely struck out.

In late 2024 and early 2025, Munga failed in his several bids to secure orders stopping the auctioning of the shares.

The tycoon told the court that he owned 75 million Britam Kenya shares, which were originally held with Genghis Capital before he later transferred them to ABC Capital.

Munga further told the court that he had planned to use the shares to secure another loan and that securities registered before his shares should be prioritized according to the doctrine of priority.

While dismissing Munga's plea to stop ABC Bank from realizing the pledged security, Justice Mabeya had ruled that the loan taken by Munga's companies remained in default and that there was no reason why ABC Bank should not have attached the shares.

"In the absence of such payment, the court finds that the prayer for a permanent injunction by Munga, preventing ABC Bank and ABC Capital from realizing the security of 75 million shares, is untenable and is therefore disallowed," Mabeya ruled.

Mabeya further ruled that the loan remained in default and dismissed Munga's plea to stop ABC Bank from realizing the pledged security.

This is not Munga's first brush with courts over Britam shares.

In July, Munga suffered another blow after Nairobi's Environment and Lands Court ordered him evicted from a 75-acre lease parcel in Murang'a County following a successful suit by Del Monte Kenya Limited, signaling a turbulent financial chapter for the retired mogul.

The contested land, currently home to Pioneer International School, an institution associated with Munga, was the subject of a protracted lease dispute.

Del Monte won the case, and Justice Anne Omollo directed Munga to vacate the land, though the school was allowed to remain until December 10, 2025, to complete the academic year.

Del Monte argued that the lease with the original tenant had expired and that Munga's subsequent acquisition and occupation of the property were unauthorized.

The food processing company maintained that its lease with the previous tenant had lapsed and that any handover to Munga was invalid.

In 2013, Del Monte leased the 75-acre property to Goshen Gardens Limited for an eight-year term at a monthly rent of Sh550,000.

However, by February 2015, Goshen Gardens had fallen behind on rent payments, prompting Del Monte to issue a termination notice.

The situation grew more complex when Goshen Gardens director, David Kigwe, approached Del Monte about transferring the property's assets to Munga, who had expressed interest in acquiring the school premises.

Following meetings in August and November 2015, Munga expressed willingness to purchase the school for an additional Sh38 million and agreed to clear outstanding and accruing rent, believing this would secure him a new lease agreement with Del Monte.

Despite these negotiations and Munga's continued rent payments, Del Monte later discovered, in October 2015, that Goshen Gardens had already handed over possession of the property to Pioneer International School without proper authorization.

To many Kenyans, Munga's name still commands admiration. Now in his early eighties, he is celebrated as one of the country's pioneering entrepreneurs, the man who turned Equity Building Society into the multi-billion-shilling Equity Bank Group, a pan-African powerhouse serving more than 21 million customers across six countries.

Born in 1943 in Kangema, Murang'a County, Munga started as a cooperative officer before founding Equity Building Society in 1984 with a simple mission: to offer affordable banking services to small farmers and low-income earners.

Decades later, his brainchild grew into Equity Bank Group, now one of Africa's largest lenders, listed on the Nairobi Securities Exchange and the Uganda Securities Exchange, with assets running into hundreds of billions

Having retired as chairman in 2018, Munga shifted focus to his personal investments, including substantial stakes in Britam Holdings, Equatorial Nut Processors where he controls more than 90 per cent ownership, and education ventures such as Pioneer Group of Schools.

After stepping down from the board, Munga remained active in private business and philanthropy.

However, some ventures have faced liquidity challenges due to delayed government payments and rising debt obligations.

The Britam dispute, insiders say, has peeled back the curtain on the quiet turbulence that has long simmered beneath the surface of Munga's empire, including the tension between his business interests and family dynamics.

The case has also reignited public debate on matrimonial property rights, especially among Kenya's wealthy couples whose fortunes are often intertwined with corporate assets.

As the courtroom doors close for now, one thing is certain, the battle over Munga's Britam shares has only just begun, and its outcome could rewrite not just one family's fortune, but the rules governing love, money, and marriage in Kenya's corporate corridors.